Road to the Summit: Prescriptions for Inland Empire economic growing pains

150 150 John Guenther

Paul Granillo of the IEEP opened the Inland Empire Regional Economic Forum last Friday. (Photo Credit: Susan Lovenburg)

The Inland Empire region of California holds the crown as the largest U.S. metro area by size and the fastest growing region by population in California. Yet clearly the big region is racked by some growing pains, still holding onto the highest unemployment rate in the country among metro areas.

How to get the Inland Empire economy to pass into maturity was one theme that ran through at an event held last Friday at the University of Redlands.

“We are a growing region, not a grown region,” said Steve PonTell, president of the La Jolla Institute.

More than 100 business and civic leaders attended the Inland Empire Regional Economic Forum, the latest gathering in series of 16 taking place around the state. The goal was to identify local priorities for state action to support the new economy.

The forum’s Briefing Book showed attendees what the region was up against as well as where its strengths lie. The Inland Empire unfortunately took a big hit in construction jobs from 2009-2012 (-6 percent) but manufacturing showed some small hope for the region with 2 percent growth.

The inland counties also added around 23,000 jobs in 2012 and is expected to finally see some growth, barring any drag caused by the sequester cuts.

But the unemployment rate still sits well above the national and state averages at around 10.9 percent. So, those are the numbers. What exactly does the region need to make a more impressive comeback?

A big topic at the forum, hosted by the Inland Empire Economic Partnership, was the economic impact of the region’s education headaches, such as high drop-out rates, that create a workforce lacking the right skills. Panelists highlighted the need to create more training programs to prepare workers for jobs available now, including manufacturing jobs where salaries are higher than average.

“Forty percent of Hispanics in this region do not have high school diploma,” said Tom Flavin of the Coachella Valley Economic Partnership. “How do we make sure everyone is prepared to work?”

Making things worse, of the people who attend the colleges in Inland Empire, most leave for jobs elsewhere, taking their higher-knowledge skills with them. “Seventy-five percent of our graduates leave the region,” said PonTell.

On the way out of town, those grads no doubt are driving off on one of the several freeways crisscrossing the region. And they’re not alone. Census numbers in 2011 showed less than 2 percent of workers in the area use public transportation to get to their job.

“300,000 vehicles run through the county daily,” said Cindy Roth, president and CEO of Greater Riverside Chambers of Commerce. “Infrastructure investment is key to our economy.”

Given the role the Inland Empire plays as a logistics and warehousing hub for Southern California, it’s no wonder that infrastructure was named a top concern for the region during the forum. When attendees were given the chance to vote on economic priorities, helping to shape a state infrastructure plan was a top vote-getter.

“We have congestion, air pollution and wear-and-tear on our highways,” said PonTell. “Infrastructure needs to be viewed as one whole system and the pieces need to be connected.”

And there’s a huge reason for the region (and the state) to get infrastructure planning right: More industrial buildings are going up in IE than last year. An additional 7.8 million square feet of space is being constructed now, compared to 4.3 million in 2011, according to a CBRE report on the IE industrial market, and that, of course, means more traffic.

Finding ways to pay for needed infrastructure upgrades and maintenance, as well as preparing a skilled workforce that aligns with the jobs out there, are two main initiatives of the Summit and are gaining much attention during the forum voting process.

Priorities identified by regions will establish the agenda for the 2013 California Economic Summit taking place in Los Angeles in November.

One of the biggest infrastructure priorities for attendees of the IE forum was wresting control of Ontario Airport away from Los Angeles World Airports and placing it in local hands. Airlines have cut service to the airport as passenger numbers have dropped. LAWA cites the poor economy for the problems, while Inland Empire groups have blamed poor management for the dip in passenger numbers.

Other top vote-getters in the forum polling included:

  • modernizing CEQA
  • training programs to support the health care industry
  • attracting philanthropic dollars to the region
  • ensuring water reliability

Panelists made sure to reinforce the notion that what’s good for California’s regional economies will be best for California. “Solutions are going to come from the bottom up,” said Flavin.


John Guenther

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